By Kristin Myers, Editor-in-Chief

ICYMI: Inflation Is the Top Problem for Small Business Owners

In case you missed it, inflation is now ranked as the top problem for small business owners, according to a recent survey from the National Federation of Independent Businesses (NFIB). Inflation has risen 8.5% since last year, the highest it's been since the end of 1981. So it's no surprise that these higher costs are impacting both consumers and business owners, especially small employers.

Over 60% of small business owners surveyed said inflation has had a "substantial impact" on their business, while one-third reported it having a moderate impact. Over 75% of small business owners pointed to inventory, supplies, and materials as big contributors to higher costs, in addition to higher prices for fuel, like gasoline and diesel.

In order to absorb the impact of inflation, 86% of small business owners said they are raising the prices of goods and services, passing their costs on to consumers. Nearly 40% of business owners said raising prices for consumers is covering all or most of the higher costs they have been experiencing.

While the Federal Reserve plans to continue interest rate hikes in order to fight against inflation, small business owners plan to continue to increase prices, especially with inflation still running at a 40-year high. Close to 70% of small employers said they will raise selling prices in the next three months, with about half planning to raise prices between 4% and 9%, and 40% planning to hike prices by 10% or more. So if you're someone who likes to shop local, be prepared to pay more.

- Kristin

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Off the Charts

Underscoring how good the job market is these days, 19.7% of respondents surveyed by the Federal Reserve Bank of New York in March reported at least one job offer—the biggest share since the pandemic hit.

For The Balance's fourth Financial Literacy Month IG live series, we're discussing the topic of wealth and its enjoyment. Join The Balance Editor-in-Chief Kristin Myers with featured guest Teri Ijeoma, master investor and founder of Trade and Travel, on Wednesday, May 4, at 12 p.m. EST. Follow us on Instagram to get updates on The Balance's live events this month!